IFMR Holdings (IFMRH) is a remarkable business that is changing the face of financial inclusion in India.
Says Sucharita Mukherjee, the company’s inspiring CEO, “Only 56.8% of the adults in India have a bank account as compared to 73% in South Africa, 77% in Brazil and 79% in China. 43% of the accounts in India have been dormant in the last year Only 7.16% of the adults in India borrow from a formal source. We want to create an ecosystem that allows us to reach excluded households and businesses, pool and distribute this risk across a broad base of large investors and also allow other investors to hold this risk as aggregators. There are many white spaces in credit markets, wealth management and capital markets that still remain untapped in India.”
IFMRH’s management team focuses on achieving financial inclusion at considerable scale, through financial innovation and by putting the customer first. They do this through investing in, operating and incubating financial services companies in India with significantly scalable business models that make a game-changing impact on their mission of access to financial services.
They do this through three businesses.
IFMR Capital (IFMRC) is a fast growing debt capital markets platform currently reaching 75 NBFC clients who offer micro-loans, small business financing, affordable housing loans, vehicles finance and other financial products. This simple statement belies the sophistication and success of the highly innovative model. IFMRC, which is A+ rated, uses a variety of structures to provide financing to its clients and enhance their credit, including direct loans, securitization, guarantees, the arrangement and placement of commercial paper, bonds, debentures, and other capital markets products. IFMRC also provides rating enhancement advisory services and recommends improvements to operations and systems to lenders. Today, IFMRC enables financing for over 13.8 million financially excluded people in 485 districts and 30 states across India, a number that is scaling rapidly. LeapFrog is a direct investor in IFMRC.
IFMRH’s two other subsidiaries are world leaders in developing financial product distribution models for emerging consumers, both of which are now getting poised for expansion. IFMR Rural Finance has developed the Kshetriya Gramin Financial Services (KGFS) model for remote rural markets. KGFS offers rural consumers insurance, savings, payments and pensions products, while prioritizing customer needs and protection through a comprehensive wealth management client servicing model. From the perspective of LeapFrog’s global financial services experience, it is both unique and compelling. The model is being put to work through the third business, IFMR Rural Channels, which reaches over 1.6 million clients, and also a business whose reach is extending by the day.
LeapFrog’s investment will accelerate IFMR Holding’s ground-breaking financial inclusion work across India, developing innovative business models and new products to meet a vast opportunity.